Peak bodies say new law needed in real estate sector

The almost decade-long, drama-shrouded Gold Tower 42 is an icon in itself. Photo supplied

A knight in shining armour could be on the horizon for the besieged Gold Tower 42, but the long-running saga looks set to continue in the absence of any formal offers.

The development, which has been little changed since its 2010 suspension, has yet to pick up from where it left off on the 32nd floor, out of the planned 42 floors.

The Ministry of Land Management, Urban Planning, and Construction (MLMUPC) is attempting to put an end to the woes that have engulfed the tower, persistently calling on the heads of the project’s developer Yon Woo Co. Ltd. to keep up with their promises of maintaining discussions with the ministry in an attempt to come to a resolution.

At the CamBuild ’16 construction exhibition held at the Diamond Island Exhibition Centre last weekend, Pen Sophal, secretary of state for the MLMUPC, said that MLMUPC senior minister Chea Sophara had been informed of potential investors keen to take over the comatose Gold Tower 42.

“The ministry has enough legal framework to force the completion of the construction, but it is the government’s objective to go with the softer approach in order to garner more international investors,” Sophal continued.

Nevertheless, no further details were given on the nature of this legal framework and what legitimate prowess it has to continue pushing for the eventual completion of the project.

Post Property was referred by Seng Lot, spokesman for MLMUPC, to Huy Nara, general secretariat of construction, who has been tasked by Sophara to oversee the entire issue, including calling for a formal letter from Yon Woo entailing negotiations and monitoring investor interest in the project.

Nara could not be contacted for information on further details of the mystery potential buyer for the development through his personal phone.

Cheng Kheng, chairman of Huttons CPL’s board of directors, said all hope was not lost for Gold Tower 42: “If there is no hope of completion, it is still okay because the construction is in a very good location that even I would want to buy the project, if all else fails.”

He continued, “Before this, the company that invested in this project had come and discussed it with me, but I told them that I can only help in selling the building if it’s completed; I cannot help them if there is no hope of completion.”

Kim Heang, president of the Cambodian Valuers and Estate Agents Association, confirmed there were investors looking to purchase the incomplete project, but are hesitating because the ministry has yet to resolve the matter with Yon Woo.

He continued, “The MLMUPC and the Ministry of Economy and Finance should come together and discuss how to solve this problem because it has already become a disease, so should we cut off our arm? Or should we keep feeding the pathogen until it eats us alive?”

“If the project is solid and open to the public to bid and buy, I’m sure that there will be a lot of buyers because from what I know, there are many people who want to buy this project right now.”

The Gold Tower 42 project was tipped to be Cambodia’s tallest building – at 192 metres high – when it initially broke ground in 2008. While construction came to a halt in 2009, the development has been stop-start for years.

An anonymus real estate industry insider speculated in front of Post Property earlier this year that while foreign developers would steer clear of such a dogged development, only a local developer with adequate resources might snatch up Gold Tower 42 and complete it without relying on initial speculative funding from project pre-sales – a local developer with direct access to funds of a local commercial bank of which kind there is only one, he said.